Odds Now on Yellen to Lead Fed, but Odds Were Wrong Before

Now that Lawrence Summersis no longer a contender to succeedBen Bernanke as chairman of the Federal Reserve, Vice Chairwoman Janet Yellen becomes the odds on favorite, at least according to a tally from betting site Paddy Power before the announcement.

Associated Press

Janet Yellen

When the online betting site first started publishing odds in July on who would be the next Fed chairman, Ms. Yellen was the runaway favorite with 1-to-5 odds — for every $5 you bet, you only get a $1 payout if Barack Obama does in fact pick Ms. Yellen. But as reporting showed the president favored Mr. Summers, her chances of taking the top spot dropped substantially.

Behind Ms. Yellen was her predecessor as vice chair, Donald Kohn, who has been mentioned by Mr. Obama as a candidate, with 20-to-1 odds. That also was the same chance bettors put on former Treasury Secretary Timothy Geithner, who has said he’s not interested in the job.

Other potential candidates, including former Fed Vice Chair Roger Ferguson and former chairman of the White House Council of Economic Advisers Christina Romer, had even longer odds.

Of course, just because Ms. Yellen now becomes the frontrunner, doesn’t necessarily mean that she is a shoe-in for the job. The final decision rests with the president and his closest advisers, and as the shifting odds earlier this summer attest, markets don’t have any inside track on his thinking.

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